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Dobbs v. DePuy Orthopedics, Inc.

United States Court of Appeals, Seventh Circuit

December 1, 2016

DUSTAN DOBBS, Plain tiff-Appellant,
v.
DePuy Orthopedics, Inc. et al., Defendants,
v.
George E. McLaughlin, on behalf of John Gehlhausen, P.C., and on behalf of Anthony G. Argeros, P.C., Appellee.

          Argued November 4, 2016

         Appeal from the United States District Court for the Northern District of Illinois, Eastern Division. Case No. 15 cv 8032 - Sharon Johnson Coleman, Judge.

          Before Flaum and Kanne, Circuit Judges, and MAGNUS-Stinson, District Judge. [*]

          Kanne, Circuit Judge.

         Dustan Dobbs hired Appellees George McLaughlin, John Gehlhausen, and Anthony Argeros as his attorneys on a contingency fee basis. Appellees filed Dobbs's product-liability claim against DePuy Orthopedics in the DePuy ASR Hip Implant Multidistrict Litigation in the Northern District of Ohio. DePuy subsequently offered to settle all claims in that litigation.

         Despite advice and pressure from McLaughlin, Dobbs refused to settle and discharged Appellees. Later, Dobbs changed his mind and decided to accept the settlement offer. Because the employment contract was inoperative when Dobbs settled, Appellees sought compensation under a quantum meruit theory. The district court awarded attorneys' fees in the full amount of the original contract. Dobbs argues that the district court abused its discretion by not analyzing the factors that Illinois courts look to when calculating reasonable attorneys' fees under quantum meruit. We agree.

         I. Background

         Doctors replaced Dobbs's left hip with a DePuy ASR artificial hip. Unfortunately, the ASR model was defective. And those defects caused Dobbs pain and other hip problems. Roughly four years after the surgery, Dobbs hired Appellees to represent him in a product-liability suit against DePuy. Appellees took the case on a 35 percent contingency fee.

         Appellees filed Dobbs's complaint in the DePuy ASR Hip Implant Multidistrict Litigation in the Northern District of Ohio. A year later, DePuy proposed a "Global Settlement" in that litigation. DePuy offered represented parties $250, 000 and unrepresented parties $165, 000.[1]

         McLaughlin advised Dobbs to accept the settlement offer because going to trial would be expensive, time consuming, and risky. Dobbs told McLaughlin that he wanted to register for the settlement but that he did not want to "agree with the settlement offer, " "waive any rights to a trial, " or "be forced to accept the present settlement offer from DePuy." (R. 32-1 at 8.) Despite McLaughlin's continued insistence that Dobbs's best option was to take the settlement, Dobbs decided that the base award did not properly compensate him for his injuries. Dobbs became frustrated with McLaughlin, believing that McLaughlin was trying to force him to settle his case when he wanted to take it to trial.

         Dobbs then filed a motion to remove McLaughlin as his attorney on October 17, 2014.[2] McLaughlin acknowledged that he no longer represented Dobbs and moved to withdraw as counsel on December 30, 2014. Acting pro se, Dobbs ultimately chose to accept the settlement offer on February 5, 2015. But because he was considered "represented" for purposes of the settlement offer, Dobbs received $250, 000.

         Because Dobbs terminated the contract before he accepted the settlement offer, Appellees could not recover the contingency fee. McLaughlin then asserted a lien on the award and sought attorneys' fees under a quantum meruit theory. Judge Katz in the Northern District of Ohio ordered mediation and personally mediated the negotiations. When the parties could not resolve the dispute, Judge Katz transferred the case to the Northern District of Illinois. There, Judge Coleman held that the full contingency fee was a reasonable award under quantum meruit. Dobbs now appeals that decision.

         II. Analysis

         We review a district court's award of attorneys' fees for an abuse of discretion. Goesel v. Boley Int'l (U.K.) Ltd.,806 F.3d 414, 419 (7th Cir. 2015); Gautreaux v. Chi. Hous. Auth.,491 F.3d 649, 654 (7th Cir. 2007). We have described that standard of review as "highly deferential" because the district court is in the best position to determine the reasonableness of an award for work done on litigation in that court. Montanez v. Simon,755 F.3d 547, 552-53 (7th Cir. 2014); Gautreaux, 491 F.3d at 659. Highly deferential review, however, does not give the district court unfettered ...


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